IntroductionElasticity is one of the most important theories in economics and is a measure of responsiveness (Baker, 2006)i. There are mainly two types of elasticity, the elasticity of demand which includes the price elasticity of demand, the income elasticity of demand and the cross elasticity of demand as well as the elasticity of supply (McConnell, Brue and Flynn, 2009)ii. The degree to which a supply or demand curve reacts to a change in price is the elasticity of the curve (Lingham, 2009)iii. Elasticity varies between products because some products may be more essential to the consumer. Consumer price elasticity plays an important role in the lives of consumers. Price elasticity of demand is the sensitivity of demand for a product when its price changes (McConnell, Brue, & Flynn, 2009)iv. Coffee shops such as Panera Bread refuse payments from customers and politely ask them to "take what they need and leave their fair share" (Strom & Gay, 2010)v, resulting in more people getting goods such as food at a fair price than they are. willing to pay. Based on the income elasticity of demand, consumers can achieve a better and healthier life because they will purchase better quality goods as their income increases. People will go to Italiannies for the pizza and not Pizza Hut because Italiannies offers a better, tastier, healthier and wider variety of choices, even when it is more expensive. With cross-elasticity of demand, consumers can obtain the same quality product at a cheaper price because rivalry between substitute goods will result in a reduction in price or an improvement in quality. Consumers can travel with MAS Airlines at a cheaper price as the rivalry between MAS and other airlines has caused prices to go down (Gunasegaran, 2011)vi. Even consumers with a low budget can purchase what they need. Consumers can get more value from a package deal when purchasing complementary products as they “go together”, for example: McDonald's McValue Lunch which includes a burger, fries and soft drink, all starting from just RM5.95 (My Food Fetish, 2009)vii. This way, consumers can benefit from purchasing certain products. Business elasticity is also important for companies. Price elasticity of demand is very important for companies to determine the price of their products and total sales and revenues. Newell demonstrated that by halving the price of the game Left 4 Dead to $25 during a Valve promotion, its sales increased by 3000% (Irwin, 2009)viii.